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Attorney General Cuomo Subpoenas All Boces In Expansion Of Pension Fraud Investigation

NEW YORK, NY (April 18, 2008) - Attorney General Andrew M. Cuomo today announced the expansion of his pension fraud probe to include all 37 BOCES (Boards of Cooperative Educational Services) across New York State. Cuomo is seeking information about the nature of employment arrangements BOCES have with professional consultants.

“We have reason to believe some BOCES may have unclean hands in this situation and that there may have been financial benefits for the BOCES to list professionals as employees instead of as independent consultants,” said Attorney General Cuomo. “There appears to be a chronic fraud that has occurred across New York State for many years, and we will work until we get to the bottom of it.”

Earlier this week Cuomo expanded his ongoing investigation into potentially fraudulent employment arrangements between public school systems and lawyers to encompass all forms of local governments across the State of New York, including more than 4,000 of the state’s county governments, villages, towns, and special districts. Previously, the Attorney General’s office issued multiple subpoenas to lawyers and law firms in Long Island and upstate.

Attorney General Cuomo continued, “Fraudulent placement of professionals on public payrolls can cost New Yorkers tens of millions of dollars by giving pension benefits to those who would otherwise be ineligible and by giving unwarranted state aid to school districts. At the end of this investigation, we want to be able to propose reforms to prevent this widespread abuse from occurring again in New York State.”

Many of the attorneys in question in the ongoing investigation appeared on the payrolls of multiple BOCES or school districts simultaneously. At least some of the attorneys who appeared on the payrolls did not actually provide legal services for the BOCES or school districts in question.

Many of these lawyers remained on BOCES’ or school districts’ payrolls for such extended periods of time, or were included on the payrolls of so many BOCES or school districts simultaneously, that they accumulated substantial credits in the New York State Employees’ Retirement System. One such attorney, who was listed on the payrolls of as many as seven BOCES and school districts in one year, may have already collected in excess of $700,000 in taxpayer-funded pension benefits.

The Attorney General’s office urges individuals with knowledge of any questionable arrangements between any BOCES, local governments, or school districts and their outside professionals to contact the Public Integrity Bureau by telephone at 212-416-8090 or by e-mail at public.integrity@ag.ny.gov.